{"id":122770,"date":"2024-02-05T17:01:00","date_gmt":"2024-02-05T21:01:00","guid":{"rendered":"https:\/\/www.shortform.com\/blog\/?p=122770"},"modified":"2024-02-06T17:02:34","modified_gmt":"2024-02-06T21:02:34","slug":"the-great-wealth-transfer","status":"publish","type":"post","link":"https:\/\/www.shortform.com\/blog\/the-great-wealth-transfer\/","title":{"rendered":"How the Great Wealth Transfer Might Disrupt the Economy"},"content":{"rendered":"\n

Who will benefit from the upcoming Great Wealth Transfer<\/a>? How could it possibly destabilize the entire economy?<\/p>\n\n\n\n

A significant financial shift called the Great Wealth Transfer<\/a> is anticipated in the coming decades as baby boomers pass down their capital to millennials and Gen Zers. However, experts predict these inheritances will disproportionately favor those who are already wealthy. <\/p>\n\n\n\n

Here’s a look at who might benefit from the wealth transfer and how it could disrupt the economy.<\/p>\n\n\n\n\n\n\n\n

The Great Wealth Transfer<\/h2>\n\n\n\n

Baby boomers, who were born into and benefited from the post-World War II economic boom, are one of the wealthiest generations in history, currently accounting for half of the wealth in the US<\/a>. Experts anticipate that over the next two decades or so, boomers will leave behind record levels of inheritances<\/strong>\u2014a so-called Great Wealth Transfer<\/a> that will reshape the financial landscape for the receiving generations and have ripple effects on consumer behavior, investment trends, and societal structures. <\/p>\n\n\n\n

This transfer may not be everything its recipients hope for, however: Experts caution the actual amount passed down may be smaller than anticipated. It\u2019s also likely to be unevenly distributed\u2014heavily favoring the already wealthy to a degree that may invite societal and economic problems. <\/p>\n\n\n\n

Who Stands to Gain<\/strong><\/h3>\n\n\n\n

Financial experts estimate that as boomers pass away over the coming decades, they\u2019ll leave behind <\/strong>more than $84 trillion<\/strong><\/a>. Approximately 15% of this may be bequeathed to charities, but the vast bulk of it is expected to be willed to the next generations. Such a windfall could ease many economic challenges for its recipients.<\/p>\n\n\n\n

But these benefits won\u2019t be felt by everyone in the younger generations\u2014only those in line for a sizable inheritance. Thus the coming bonanza will disproportionately benefit descendents of the white, upper class.<\/p>\n\n\n\n

Possible Consequences<\/strong><\/h3>\n\n\n\n

Many observers are warning that this discrepancy between the haves and the have-nots may destabilize the economy as a whole<\/strong>: If, for example, the housing market<\/a> heats up even more than it already has because of increased demand from newly rich 30-year-olds, those left out of the Great Wealth Transfer<\/a> will find it even harder to establish a foothold in real estate. Should the transfer intensify existing economic disparities to the point where the rich monopolize resources and opportunities, it could disrupt social stability and economic growth<\/a>. <\/p>\n\n\n\n

Expectation Versus Reality<\/strong><\/h3>\n\n\n\n

Those outside of the top 1.5% may be disappointed in their inheritances for additional reasons: The actual amount handed down to beneficiaries may be less than anticipated. <\/p>\n\n\n\n

There are several reasons for this discrepancy:<\/p>\n\n\n\n